Most of the wounded in the July 10 bombing were women and children, Afghan presidential spokesman Karim Rahimi said.
President Hamid Karzai order the investigation into the raid after civilians and a legislator in Uruzgan province told reporters that up to 60 civilians had been killed.
Rahimi said the strike was launched near the provincial capital Tirin Kot after intelligence that eight Taliban were meeting at a local man's home.
"There was a raid on that house," he said. "That house was destroyed and three other houses were destroyed. Ten civilians were killed and 27 wounded."
Rahimi could not immediately give details of the dead civilians.
He said the Taliban had returned fire on troops from the multinational force from civilian homes, resulting in some of the casualties.
The inquiry recommended that the multinational commanders improve their coordination with Afghan forces before launching strikes, Rahimi said.
Officials would also ask locals "to not allow Taliban to use their homes, or the mosques, or holy places for military purposes".
Maulvi Muhayuddin Baluch, who was part of the five-member team sent to investigate the clashes, said that all eight Taliban members were killed.
The multinational force is also investigating the incident.
US to compensate
The US government has approved compensation of more than $112,500 to victims of a traffic accident involving a US military truck that sparked hours of rioting in May.
A total of 24 claims for property and personal damages are being paid.
The truck collided with other vehicles on the outskirts of Kabul after an apparent brake failure, causing a number of casualties. The coalition has admitted to only one fatality, but Afghan officials said at the time that five people were killed.
The crowd that gathered at the site began pelting US troops with stones and the soldiers opened fire causing more deaths, according to witnesses.
Rioting erupted across the capital, buildings were torched and looted and more people were killed as security guards opened fire in an attempt to control the violence.
An Afghan government investigation said 17 people were killed during the day.
The multinational force said a report into the accident is likely to be released next month.